Summary

This script synthesizes the results for different domestic and trade carbon policies in 48 developing countries with net-zero emissions targets.

These results assume a social cost of carbon equal to $190 and a carbon price equal to $163 (click here to view the results at different carbon prices).

The countries we study are listed below. Each link will take you to an in-depth, country level analysis.

Our counterfactuals are split into two parts.

Part 1

In Part 1, we examine the impact of four distinct counterfactuals across our sample of 48 countries. For each country, we apply each counterfactual holding all else constant. We then compile and report the results for each country and counterfactual scenario.

CTF1: Setting tariffs in each sector to bilateral mean (Shapiro)

CTF2: Setting MFN tariffs in each sector to the OECD mean

CTF3: Changing domestic tax policy to incorporate a carbon tax on production

CTF4: Changing domestic tax and international trade policy to incorporate a carbon tax on production and imports

Part 2

In Part 2, we implement the same strategy as in Part 1 except for counterfactual 5. For counterfactual 5, we examine how the coalition impacts all countries in our sample simultaneously and report those results.

CTF5: The US, EU, and CHN form a coalition and implement a carbon tax on domestic production and carbon tariff on imports.

CTF6: The US, EU, and CHN form a coalition and implement a carbon tax on domestic production and carbon tariff on imports. A country in our sample simultaneously responds, implementing a carbon tax and carbon tariff with equivalence.

CTF7: The US, EU, and CHN form a coalition and implement a carbon tax on domestic production and carbon tariff on imports. A country in our sample simultaneously responds, implementing a carbon tax and carbon tariff without equivalence.

Part 1

Welfare

The figure below reports the distribution of percent changes in welfare for each country in our sample after implementing the counterfactual policy.

The figure below reports the distribution of percent changes in welfare for each country in our sample grouped by region after implementing the counterfactual policy.

Trade flows

The figure below reports the distribution of percent changes in trade flows for each country in our sample after implementing the counterfactual policy.

The figure below reports the distribution of percent changes in exports for each country in our sample grouped by region after implementing the counterfactual policy.

The figure below reports the distribution of percent changes in imports for each country in our sample grouped by region after implementing the counterfactual policy.

Emissions

The figure below reports the distribution of percent changes in GHG emissions for each country in our sample after implementing the counterfactual policy.

The figure below reports the distribution of percent changes in GHG emissions for each country in our sample grouped by region after implementing the counterfactual policy.

Part 2

Welfare

The figure below reports the distribution of percent changes in welfare for each country in our sample after implementing the counterfactual policy.

The figure below reports the distribution of percent changes in welfare for each country in our sample grouped by region after implementing the counterfactual policy.

The bars in the figure below represent the percent changes in welfare for each country due to the formation of the coalition. The corresponding dot and triangle represent the changes in welfare given each country’s were to respond with and without equivalence respectively.

The figure below compares the percent changes in welfare for each country given how they respond to the formation of the coalition.

Trade flows

The figure below reports the distribution of percent changes in trade flows for each country in our sample after implementing the counterfactual policy.

The figure below reports the distribution of percent changes in trade flows to partners within and outside of the coalition for each country in our sample after implementing the counterfactual policy.

The figure below reports the distribution of percent changes in exports for each country in our sample grouped by region after implementing the counterfactual policy.

The figure below reports the distribution of percent changes in exports for each country in our sample grouped by region after implementing the counterfactual policy.

Emissions

The figure below reports the distribution of percent changes in GHG emissions for each country in our sample after implementing the counterfactual policy.

The figure below reports the distribution of percent changes in GHG emissions for each country in our sample grouped by region after implementing the counterfactual policy.